Terms & Conditions of Sale

1. General

(a) This document constitutes an offer by HeartWare, Inc. (including applicable affiliates, “HEARTWARE”) to provide products and/or services to buyer (“BUYER”), which may be further described in a separate agreement, purchase order or invoice. HEARTWARE agrees to provide the products and/or services to BUYER only on the terms set forth herein notwithstanding any language in BUYER’s purchase order, if one exists, or other written or oral agreement made prior to, simultaneously with, or at any time after delivery of the Product to BUYER. No addition or modification of these terms and conditions may be made by BUYER without HEARTWARE’s express written agreement. HEARTWARE’s agreement to provide the products is expressly conditioned on BUYER’s assent to all of the terms and conditions set forth herein.

(b) These terms and conditions shall be governed by and construed according to the laws of the State of Delaware, USA.

(c) The invalidity of any provision herein shall not affect the validity of any other provision.

(d) The failure of HEARTWARE to insist, in any one or more instances, upon performance of any term herein shall not be construed as a waiver or relinquishment of any right granted hereunder or the future performance of such term.

2. Delivery and Risk of Loss

(a) All shipments are FCA HEARTWARE’s shipping point (Incoterms 2000). BUYER may pay all shipping costs directly or they shall be added to the invoice price. Unless specified, HEARTWARE will select a recognized carrier for shipping for BUYER’s account. Delivery shall be deemed to have been made when HEARTWARE places the products at the disposal of such carrier and products shall be at the risk of BUYER from such time.

(b) No product returns shall be accepted for credit without prior written approval of HEARTWARE.

(c) Shipping dates communicated by HEARTWARE are based on prompt receipt of all necessary information regarding the order. HEARTWARE will use its reasonable business efforts, but does not guarantee, to meet scheduled dates. HEARTWARE reserves the right to make delivery in installments. Delay in delivery shall not relieve BUYER of its obligations to accept remaining deliveries.

(d) HEARTWARE is not responsible for any loss, damage or delay which may occur after the earlier of (i) products have been delivered to carrier and (ii) BUYER takes possession. All claims relating to shipment shall be made to the carrier.

3. Inspection of Products and Title

BUYER shall inspect products immediately after receipt. Claims for shortages, defects or other errors must be made in writing to HEARTWARE within five (5) days after receipt of shipment. Failure to give such notice shall constitute unqualified acceptance and a waiver of all claims by BUYER. Rejected goods shall be returned freight prepaid to HEARTWARE within ten (10) days of rejection. Title passes to BUYER on delivery to carrier.

4. Taxes and Other Charges

All taxes, inspection or testing fees, freight costs, insurance or any other fee or charge whatsoever, imposed on, in connection with or measured by any transaction between HEARTWARE and BUYER shall be paid by BUYER in addition to the prices quoted or invoiced.

5. Terms of Payment

(a) Payments to HEARTWARE are to be made by BUYER net 30 days of the invoice date. BUYER agrees to pay, at HEARTWARE’s discretion, a late payment charge of 1½% per month (18% per year) on all amounts not paid in full within 30 days of the invoice date, or the highest rate permitted by applicable law, whichever is less.

(b) Payments shall be made by wire transfer to HEARTWARE’s bank account or as BUYER may be advised by HEARTWARE in writing from time to time.

(c) If BUYER fails to pay any amount due to HEARTWARE when due or if BUYER defaults under or breaches these terms and conditions, HEARTWARE may, without liability and in addition to any other remedies: (i) declare immediately due and payable all BUYER’s obligations to HEARTWARE, (ii) change credit terms with respect to any further deliveries or overdue amounts, or (iii) suspend or discontinue any further deliveries or other obligations until BUYER pays all overdue amounts.

(d) BUYER agrees to reimburse HEARTWARE for all costs, including any legal fees on a solicitor-client basis, incurred by HEARTWARE in collecting any sums owed by BUYER to HEARTWARE.

6. Cancellation and Changes

BUYER may not cancel or modify its purchase order or any part thereof without HEARTWARE’s prior written consent. HEARTWARE reserves the right to change the price, terms of payment and delivery dates for any products affected by any modification to which it consents.

7. Limited Warranty

(a) HEARTWARE warrants that products manufactured by HEARTWARE will, at the time of shipment, be free from defects in workmanship and materials under normal use in accordance with HEARTWARE’s product labeling. HEARTWARE shall not be liable to BUYER, or to anyone claiming under BUYER, for any other obligations or liabilities, including but not limited to obligations or liabilities arising out of breach of contract or warranty, negligence or other tort or any theory of strict liability, with respect to the products or HEARTWARE’s acts or omissions. IN NO EVENT SHALL HEARTWARE BE LIABLE FOR INCIDENTAL, CONSEQUENTIAL OR OTHER DAMAGES, INCLUDING LOST PROFITS. HEARTWARE’S AGGREGATE LIABILITY WITH RESPECT TO DEFECTIVE PRODUCTS SHALL BE LIMITED TO THE MONIES PAID BY BUYER TO HEARTWARE FOR SUCH PRODUCTS. All claims must be brought within one (1) year of shipment, regardless of their nature. Rejected goods shall be returned freight prepaid to HEARTWARE within ten (10) days of rejection.

(b) HEARTWARE and BUYER agree that the warranties in paragraph 7(a) are exclusive and in lieu of all other warranties, including, but not limited to, express or implied warranties of title, merchantability or fitness for any particular purpose. HEARTWARE hereby excludes to the extent permitted by law all implied warranties of title, merchantability and fitness for any particular purpose and all other express or implied warranties. Any oral or written description of the products is for the sole purpose of identifying the products and shall not be construed as an express warranty. The warranties shall apply only if HEARTWARE’s examination discloses to HEARTWARE’s satisfaction that alleged defects actually exist and were not caused by misuse, unauthorized modifications, neglect, improper use or storage, attempts to repair, or the like, or by accident, fire, or other hazard.

8. Intellectual Property; Confidential Information

All products, services, specifications, documents and other materials supplied to BUYER pursuant to these terms and conditions or otherwise are HEARTWARE’s exclusive property. BUYER will treat as confidential and not disclose any information received from HEARTWARE in connection with these terms and conditions and the related transactions.